Gagan Thapa’s ascent to the Congress presidency was dramatic enough to promise something new. In January 2026, riding a wave of fury from the Gen Z protests that had shaken Nepal’s political establishment to its foundations and forced the dissolution of parliament, he engineered a special general convention that swept aside the old guard under former president Sher Bahadur Deuba. The Election Commission legitimised the gathering. The Supreme Court confirmed it. For a party that had lurched from coalition to coalition, sold its democratic soul for a share of cabinet posts, Thapa looked like the shock of renewal the Congress desperately needed.

Within weeks of assuming the party’s highest office, Thapa led the Congress into the March 5 general election. His campaign was a referendum on his own image rather than a programme of government. He spoke of reform, of inclusiveness, of a united push into the polls – phrases that, in Nepali politics, carry roughly the same weight as a campaign balloon the morning after polling day. When pressed on specifics – on economic policy, on Nepal’s chronically stalled federalism, on the question of how a country haemorrhaging young people to the Gulf and Malaysia might be made worth staying in – the answers were warm and vague. He would listen, consult and make “good decisions”.

Result? He lost his own seat in Sarlahi-4 to a candidate from the Rastriya Swatantra Party, the upstart anti-establishment movement that ate the Congress’s lunch precisely because it offered voters something Thapa never quite managed: a clear account of how it seek to “ruthlessly” govern. 

The tragedy of Thapa is that his résumé suggests a man capable of exactly the kind of political courage his leadership has lacked. He began in the Nepal Student Union in the late 1990s, rising through campus politics with a reputation for confrontation and conviction. When King Gyanendra seized direct rule in the early 2000s, Thapa was imprisoned repeatedly on charges related to treason. He emerged from that period with a credibility few of his generation could match, and played a prominent role in the second People’s Movement of 2006 that restored democracy. 

Yet somewhere between the streets and the committee rooms, that clarity curdled into calculation. His style of leadership is, at its core, reactive. He surveys the media landscape, identifies the prevailing current of opinion, and positions himself fractionally ahead of it – close enough to seem prescient, far enough to avoid committing to anything that might later prove unpopular. In Nepal’s febrile press culture, where the Kathmandu commentariat sets the terms of political legitimacy from one news cycle to the next, this can look like responsiveness. It is, in practice, the absence of guts.

The clearest illustration of this tendency came during the ill-fated coalition of 2024, when KP Sharma Oli of the CPN-UML and the then-Congress president Deuba struck a power-sharing arrangement that hollowed out parliamentary opposition. Thapa accepted to lead the high-level mechanism tasked with drafting a common minimum programme. But while leading the mechanism team, he would come out in media and talk like an opposition. Even his dissent was delivered in the language of procedural objection rather than ideological clarity. He questioned the government’s “speed, focus, skill, and intention,” as he told parliament in August 2025. What he did not do was articulate an alternative vision of what Nepali governance could look like. 

Those who know Thapa well speak of a man constitutionally averse to making enemies. This is, in personal life, an admirable quality. In democratic politics, it is a serious handicap. Running a major political party means choosing between constituencies, not satisfying all of them. It means telling powerful interests within your own organisation that their preferences will be subordinated to a broader project. It means, in short, making people unhappy in the service of a principle. Thapa, by most accounts, finds this deeply uncomfortable. He prefers to keep everyone in the conversation, to postpone the hard call in favour of another round of consultation, to emit the warm but uncommitted energy of someone who wants to lead but does not want to govern.

The Nepali Congress president is also one of the most media-literate politician of his generation. He understands the rhythms of the news cycle, the vocabulary of the opinion column, the visual grammar of the social media clip. He courts journalists, accommodates their framing, and in turn receives coverage that has consistently overstated the coherence of his political project. But governing a complex country of thirty million people across mountains and plains and castes and languages requires a leader who is occasionally willing to say things the press does not want to hear. Fiscal discipline is unpopular. Agricultural reform is complicated. Tackling the structural incentives that make foreign labour more attractive than domestic investment requires policies that will hurt someone. Thapa has shown no appetite for any of it. He governs – or rather, he opposes – by the standard of the morning headline.

The Congress, under his stewardship, produced an election campaign that even sympathetic observers described as thin on substance. The party that in better days could claim intellectual ownership of Nepali democracy – that produced B.P. Koirala, whose vision of social democracy still haunts the party’s rhetoric if not its practice – went to the voters with its president’s face and not much else. RSP, led by a former rapper turned Kathmandu mayor Balen Shah with gift for speaking in plain language about plain problems, ran rings around the Congress on policy coherence. 

None of this is to say that Thapa is finished, or that the Congress is beyond repair. But saving it will require a transformation that looks less like reinvention and more like excavation. The Congress, which faces a rebuilt 15th general convention in the coming months, needs a leader who can tell the party’s fractious factions, its donor networks, its media allies, and its voters something they may not want to hear: that the party must choose what it stands for, and that standing for everything is the same as standing for nothing.

Step inside any pasals in Nepal and the world is small and specific: a glass counter cloudy with fingerprints, shelves of instant noodles and mustard oil arranged with private logic, a dog asleep near the door, a proprietor who knows you and probably your four generation. The shopkeeper extends credit on a Tuesday without asking. He/She knows which festival is coming and which goods you will need for it. They are, without anyone having legislated it, a node in the social infrastructure of neighbourhood, a confessor, a loan officer, a notice board and a meeting place, all at once.

According to the UN Capital Development Fund, kirana stores make up nearly 90 per cent of the country’s entire retail sector. Yet something is changing, and changing fast. It is transforming through the steady accumulation of pressures that are reshaping how Nepal buys, sells and, by extension, how it lives.

The clearest emblem of this change is Bhat-Bhateni. What started in 1984 as a modest cold store near Naxal, Kathmandu, opened with an investment of a mere NRs 35,000 by Min Bahadur Gurung, an economics graduate who was still commuting from a banking job in Nepalgunj. Today the chain operates 27 outlets across the country, employs more than 22,000 people and records daily sales exceeding NRs 5.5 crore. Its annual turnover reached NRs 30.62bn in 2024, growing at nearly 3 per cent even against a sluggish economy. Footfall across its stores reportedly exceeds 50,000 people per day.

Big Mart, Sales Berry and KK Market are other examplers. Online retailers, most prominently Daraz, are eating into categories that were once the exclusive province of the corner shop. New apps modelled on rapid-delivery services allow Kathmandu residents to order kirana-style goods without walking to the end of their lane.

Consumers in Nepal’s growing urban middle class, increasingly time-pressed and mobile, value the wider selection, consistent quality and fixed pricing that supermarkets offer. For a country where kirana shops have often been accused of opaque pricing and occasional black-marketing, the formal retail model promises accountability. Employment at the chain is formal, taxed and, for the 95 per cent of its workforce who are women, often represents their first structured job.

The country is, by every measure, one of the ten fastest-urbanising countries in Asia. Its urban population grew from 22 to 27 per cent between 2011 and 2021, and the Kathmandu Valley alone accounts for an estimated 23 per cent of national GDP. The rural-to-urban migration driving this shift dismantles, community by community, the dense networks of obligation and familiarity that the neighbourhood pasal both expressed and sustained. When a village empties, its shop closes. When a family moves to Kathmandu and rents a flat in Lalitpur or Kirtipur, they shop at a Big Mart three blocks away and order the rest online. They do not know the shopkeeper’s name.

The pasal is a custodian of local particularity in ways that are difficult to inventory but easy to lose. The Newar spice merchant whose family has sold timur and jimbu from the same Asan stall for three generations carries embedded knowledge about sourcing, preparation and seasonality that no supply-chain algorithm preserves. The tea-shop owner in a Tamang village who knows which herbs to stock before Dashain and which remedies to keep near the counter holds a form of community pharmacy that no Bhat-Bhateni branch on the highway provides. These micro-worlds of knowledge and relationship do not transfer to the cloud when a shop closes.

It is worth being clear: many Nepali pasals operated as informal monopolies within their lanes, charged arbitrary prices to customers with no alternatives, and survived on the inertia of geography rather than the quality of their service. The arrival of formal competition is not obviously cruel. For women especially who make up the majority of daily shoppers but rarely owned the pasals they depended upon, the transparent pricing and wider selection of formal retail can represent genuine liberation.

Nor is the demise of small retail foreordained. The picture across Nepal is uneven. In Thamel and the tourist districts, independently-owned shops have found resilience by catering to foreign visitors willing to pay for authenticity. In some hill towns, cooperatively-owned community stores have emerged as successors to the individual pasal, preserving some of the social function while achieving better economics. The UNCDF’s work with digital financial services helping kirana owners use platforms like Khalti to accept digital payments, process utility bills and manage inventory suggests that some of the efficiency gap between small shops and large chains can be closed through technology rather than elimination.

The question for Nepal is not whether the pasal can survive unchanged, it cannot. The question is whether, in its transformation, anything essential survives with it. The country is young, rapidly urbanising and rightly ambitious about economic development. Its policymakers are understandably more interested in building hydropower dams and attracting foreign investment than in preserving the architecture of traditional retail. And yet, as the economists of the OECD have noted of similar transitions elsewhere, retail SMEs and the family-owned shop is the purest expression of this category, are not merely economic units. They are the connective tissue of communities, the daily ritual through which people experience themselves as belonging to a place and to each other.

Nepal is choosing development, which is rational and necessary. What would be useful and what is largely absent from the national conversation is some honest accounting of what development, in this particular domain, costs. The last generation of shopkeepers will not appear as a line item in anyone’s budget. The social debt their passing accumulates, however, will eventually have to be paid.

There is a long-established ritual to Nepal’s annual policies and programmes: the President reads the government’s plans to a joint sitting of both houses of parliament, and the prime minister sits dutifully in attendance, escorting the head of state in and out and offering brief remarks. On Monday, May 11th, Prime Minister Balendra “Balen” Shah broke with this convention so conspicuously that it consumed the rest of the week’s political oxygen, even as his finance minister Dr Swarnim Wagle, was trying to build momentum for a genuinely ambitious budget.

President Ram Chandra Paudel had barely been reading for 50 minutes when Shah stood up and walked out. He had arrived in a black T-shirt, black coat and white sports shoes, an outfit that itself attracted commentary, and left without bidding farewell to the President or making the customary remarks when tabling the proposal of thanks. His office later attributed the departure to “health-related discomfort.” Opposition leaders were not persuaded. Nepali Congress parliamentary party leader Bhishma Raj Angdembe called the conduct “unprecedented,” adding: “Perhaps Nepal’s prime minister will now enter the Guinness World Records because no other prime minister in the world has walked out while his own government’s policies and programmes were being presented.” Former prime minister Pushpa Kamal Dahal urged the RSP not to “misuse its numerical strength” and instead strengthen democratic procedures.

Shah has actually not addressed the House of Representatives since taking office in late March, arguably the first prime minister in Nepal’s modern parliamentary history to have gone more than six weeks without doing so. He has also repeatedly declined invitations from the House’s State Affairs Committee. When opposition lawmakers demanded his presence for the ensuing debate on the policies and programmes, Wednesday’s session broke down entirely. A familiar cast of obstructors: Nepali Congress, CPN-UML, the Nepali Communist Party, Rastriya Prajatantra Party and others, stood in the Well demanding Shah appear in person. Harka Sampang of the Shram Sanskriti Party led the disruption and called for the prime minister’s resignation. The House could not proceed.

By Thursday, discussions on the policies and programmes had resumed in the House of Representatives in the prime minister’s continued absence, with 35 amendment proposals filed by opposition parties. Meanwhile, Finance Minister Wagle tabled the document in the National Assembly, the upper house, where the arithmetic is altogether different. The RSP commands close to two-thirds of the 275-seat lower house. In the 59-member National Assembly, it has not a single seat.

The upper house is elected through provincial assemblies and local governments on a staggered six-year cycle, meaning the RSP’s landslide in the March 5 general election has produced no representation there at all. This constitutional design intended to provide a counterweight to lower-house dominance is now doing exactly that. Eight ordinances that the Balen government had rushed through by proroguing parliament earlier in April must pass both houses to remain in force. The National Assembly registered amendment notices against several of them. CPN-UML announced it would not participate in the voting; Nepali Congress said it would reject anything that curtailed fundamental rights or violated the constitution’s spirit. Nonetheless, the policies and programmes themselves, unlike the controversial ordinances, passed the National Assembly on May 14th without a division vote, after all amendment proposals were defeated by voice.

The ordinance episode has already become a flashpoint. The RSP prorogued a scheduled parliamentary session in order to issue the eight ordinances covering cooperatives, procurement, universities, anti-money-laundering, the Constitutional Council and others, then convened parliament once they were already in place. Opposition parties across the spectrum called it “executive overreach.” The most contentious provision redefines “majority” in the Constitutional Council (which recommends key constitutional appointees) so that three of its six members, including the prime minister, can constitute a quorum. Critics say it concentrates appointment power in the executive, undermining the purpose of the council’s multi-party design.

Amidst the procedural drama, the substance of the government’s plans for fiscal year 2083/84 and the broader 100-point reform framework underpinning the upcoming budget deserves scrutiny on its own terms. The document is genuinely ambitious, and in places breaks from the boilerplate that has characterised its predecessors. Finance Minister Wagle has said the budget, due to be presented on Jestha 15, will be built around five themes: the “dividend of good governance,” economic restructuring, integrated infrastructure, expansion of the middle class, and leveraging Nepal’s “soft power” through tourism and the diaspora.

The policies document represents a coherent, if optimistic, vision of what a reform-minded single-party government with a youthful mandate could accomplish. The RSP is led predominantly by people under 40, and the agenda shows it, emphatic on digital transformation, instinctively distrustful of the old bureaucratic culture, and impatient with the coalition horse-trading that has defined Nepali politics for three decades. Finance Minister Wagle, an economist by training, has been the administration’s most effective public communicator: methodical, data-literate and willing to acknowledge the structural problems that previous governments preferred to paper over. His five-budget-themes framework is the most coherent pre-budget articulation in recent memory.

Yet the gap between intention and delivery is Nepal’s most durable political tradition. Capital expenditure ran at just 24 per cent of budget in the current fiscal year with two months remaining, a figure that has barely budged across administrations. Nepal has never spent the full capex allocation. The government’s 7 per cent annual growth target over the next decade looks particularly strained against a projected 2.3 per cent in the current year. Former government secretaries point out that Nepal’s governance challenges have rarely been a shortage of plans; they have been the entrenched bureaucracy, weak monitoring, and poor inter-ministry coordination that dilute even the best-designed reforms once they leave the prime minister’s office.

The name Sapana means dream in Nepali. Sapana Pradhan Malla’s, the senior-most justice on Nepal’s Supreme Court, parents gave this name to her not as a wish but as a lament. They had wanted a son. She trained at Harvard and Delhi, spent three decades fighting for women’s rights in law, and served nine and a half years on the bench. She was Acting Chief Justice when her government looked at her record and chose someone else.

On May 7th, the Constitutional Council chaired by Prime Minister Balendra Shah, the former Kathmandu mayor who rode a Gen Z wave to a landslide election victory in March, recommended Justice Manoj Kumar Sharma as Nepal’s 33rd Chief Justice. Sharma was fourth in the seniority order. Two other justices ranked above Sharma were also passed over. The decision was not unanimous though as the National Assembly chair and the leader of the opposition registered formal written dissent, saying they could not accept a recommendation that “violated established procedures and tradition.”

The Prime Minister’s response was blunt. Tradition alone, he said, cannot justify appointments. Merit, expertise, and judicial capability must also matter. He is not wrong about that and that is where the conversation must begin, and where Nepal’s commentariat has mostly refused to go.

Nepal’s constitution does not require the most senior justice to become Chief Justice. Article 129 sets a floor at least three years of Supreme Court service but leaves the selection to the Constitutional Council. The convention of appointing by seniority dates, as defenders of the practice note, to the post-Rana era, making it roughly seven decades old.

What made this particular departure explosive was not merely the breach of protocol. It was the identity of the person bypassed. Nepal had its first female Chief Justice only in 2016, when Sushila Karki, a septuagenarian former advocate known for her zero-tolerance approach to corruption became the 26th to hold the post. Her tenure lasted less than a year before an impeachment motion, widely regarded as politically motivated, suspended her. The UN High Commissioner for Human Rights at the time said the attempt to remove her gave rise to “serious concerns about the Government’s commitment to the rule of law.” She went on to write a memoir, Nyaya (Justice), and a novel, Kara (Prison), and then, in a twist that only Nepal could produce, became interim Prime Minister following the Gen Z protests of September 2025 that toppled KP Sharma Oli.

Karki handed over power to Shah’s government only six weeks before his Constitutional Council sidelined Nepal’s second woman in line for the same court’s top post. She is among those who have publicly raised concerns about the recommendation process.

Two days after being bypassed, acting Chief Justice Malla addressed the 74th Law Day ceremony in Kathmandu. “Justice cannot prevail under fear or influence,” she told the assembled legal fraternity. “Whether it is the fear of a powerful government or the threat of impeachment, judges must rise above such narrow constraints.” She called on the Nepal Bar Association, civil society, and the media to protect judicial independence from what she described as “structural conspiracies.” She also said, for those paying attention, “I myself fought discrimination and injustice throughout my life. Our fight is still not over.”

These are stirring words. They are also, it must be said, the words of a litigant in her own cause, delivered from a judicial platform, directed explicitly at the government that had just declined to elevate her.

The response to this speech in Kathmandu was largely celebratory. Legal activists filed a writ to annul the Constitutional Council’s recommendation. Former prime minister Baburam Bhattarai added his voice to the chorus of criticism. The framing was consistent and simple. A qualified woman had been denied what was rightfully hers, and the motive must be understood as political suppression of women.

Shah’s government chose Justice Sharma because, by their account, he is the better-qualified candidate for the specific institutional challenges facing Nepal’s Supreme Court. More than 22,000 cases sit pending. Public trust in the judiciary has been eroded by years of allegations about corruption and political interference. Whether Sharma is genuinely better equipped to address these than Malla is a question that deserves examination but in the resulting storm, almost no one examined it. The story was, from the moment the decision was announced, entirely about gender.

Malla’s own career offers a clue to the complication. She left a lucrative corporate law practice in the 1990s because, as she has said, she was troubled by how the law discriminated against women. She founded the Forum for Women, Law and Development. She contributed to the drafting of the Human Trafficking Bill, the National Women Commission Bill, gender equality legislation, and succession rights reform. They are also the achievements of an advocate, a campaigner, a person who came to the bench with a defined mission.

But Nepal’s judiciary does not need more advocacy. It needs the kind of judge who looks at a case and follows the law wherever it leads including, sometimes, to conclusions that cause discomfort to the causes one holds dear.

There is a serious and largely taboo argument worth making here. Because activist lawyers produce a particular kind of judge. One who is sensitive to outcomes, oriented toward correcting past wrongs, and inclined to weigh human stakes alongside legal merits. These are not neutral qualities. In a house or office, they may even be virtues. At the highest bench in a country, they become a problem. Claire Lehmann, the founder and editor of Quillette, has written and published extensively on the distinction between what she calls the “care” orientation more commonly found in the moral psychology of women and the “justice” orientation that formal legal reasoning demands. Her argument is not that women make bad judges. It is that when institutions responsible for dispassionate adjudication are staffed or led by people whose identity and professional history are inseparable from advocacy for a particular group, the result is not neutrality but a different kind of bias, one that wears the costume of principle.

This is an argument that polite opinion in Nepal and in most of the Western-influenced discourse that shapes elite conversation there refuses to have. It is easier to say that any bypassing of a senior female judge is automatically discriminatory than to ask whether the career that brought her to seniority is the right preparation for the role.

There is a version of this story in which Shah, having promised to run Nepal differently from the corrupt machine politicians who preceded him, decided that the Chief Justice of the Supreme Court should be the most capable jurist available rather than simply the next in line and that this decision happened, in this instance, to disadvantage a woman. That version deserves at least as much attention as the version in which a misogynistic government kicked women out of their rightful place.

It is worth noting that Shah’s government includes women in senior positions. His Constitutional Council meeting was attended by the Deputy Speaker, a woman. His Law Minister is a woman. The framing of this decision as an act of gendered malice requires one to ignore quite a lot of contradicting evidence.

It is also worth asking what the seniority convention was actually doing. Seniority systems exist, in part, to depoliticise appointments to remove discretion from powerful actors and replace it with a neutral rule. But Nepal’s recent history suggests the convention was already failing at that purpose. Shah’s decision to select on grounds other than seniority is, in this light, less a revolutionary break than an honest acknowledgment that the convention had become a fiction.

And yet the breach matters. Not because Malla was entitled to the post as a woman, but because predictable rules protect the independence of any judiciary. If a chief justice can be chosen on the basis of executive preference even well-intentioned, merit-based preference then future executives will do the same, and not all of them will have Shah’s stated reasons.

Nepal has made genuine, hard-won progress on women in public life. Sushila Karki became chief justice, then prime minister. The constitution mandates representation. Women now make up 13.8% of judges, still low, but higher than a generation ago. Sapana Pradhan Malla’s career, whatever one thinks of the outcome here, represents a real advance in the range of people who can reach the top of the country’s legal establishment.

But progress is not served by the refusal to ask hard questions. It is not served by the assumption that any outcome disadvantageous to a woman is ipso facto unjust. And it is certainly not served by a sitting acting chief justice who uses a ceremonial platform to deliver what amounts to a political speech directed at the government and receives nothing but applause for it.

Malla said, “Our fight is still not over.” But if the Chief Justice of Nepal’s Supreme Court understands her role as a fight, one must ask what it is being fought for, and against whom, and what happens to the litigants who find themselves on the wrong side of it?That is the conversation Nepal is not having. It is the one it needs.

“Today RSP/Balen government completes one month,” wrote Rabindra Mishra, former vice-chairman of the Rastriya Prajatantra Party. Mishra, a veteran observer with no particular loyalty to the new dispensation, offered a remarkable ten-point audit. Ministers, he noted, are no longer seen draped in garlands weighing kilograms; they are not turning up to ribbon-cuttings and pointless receptions; roads are not blocked when the prime minister travels; and, for the first time in decades, there is “a sense of new and clean politics.” 

He concluded with a pointed wish, “the day the government legally dissolves the party-affiliated fraternal organisations of teachers, professors and civil servants, I would celebrate with a feast.” Those organisations, he wrote, are the termites of good governance. While they survive, clean administration is a fantasy. But it is one particular act – the clearing of squatter settlements along Kathmandu’s riverbanks – that has made the Balen government’s first month genuinely historic.

The operation began in the early hours of a Saturday. Hundreds of security personnel from the Nepal Police, the Armed Police Force and the Kathmandu Metropolitan Police fanned out along the Bagmati riverbank in Thapathali. Most residents co-ordinated and bundled their belongings into trucks. By midday the corrugated-iron shelters that had lined the riverbank for a generation were rubble.

The scale of the operation, as detailed by Deepa Dahal, the prime minister’s press and investigation officer, was considerable. Settlements in ward 9 (Gairigaun) and ward 31 (Shantinagar) of Kathmandu Metropolitan City were cleared of structures on encroached riverbank and public land. The Thapathali settlement in ward 11 was vacated by 12:30 in the afternoon. Nepal Police and metropolitan police officers did not merely stand guard but physically helped residents carry and transport their belongings. Residents themselves, Dahal reported, expressed solidarity with the government’s move, making the Thapathali transfer “peaceful and cordial.”

By the dusk, 144 families from Thapathali, Gairigaun and Shantinagar had made contact with government authorities. They were first taken to Dasharath Stadium in Tripureshwor, where their details were recorded. Temporary accommodation was then arranged for them in various Kathmandu hotels, while household goods were stored in two designated locations: the stadium itself and the Radhaswami Satsang Byas Nepal facility in Sundarighat, Kirtipur. Search and rescue teams continued working to ensure no residents had been left behind. Plans to clear settlements in Gothatar Buddhachowk and Manohara Tol in Kageshwari Manohara municipality were paused for the day.

The clearance of these three settlements is the most dramatic act yet of a government barely one month old. It is also, in ways that go well beyond urban planning, a political earthquake.

Nepal has a squatter problem of formidable proportions. Kathmandu Metropolitan City alone has an estimated 2,245 landless squatter families along its riverbanks. Across the country there are reckoned to be millions more. Fourteen separate commissions were formed after 1990 to resolve the issue. None succeeded. The settlements became a fixture of the capital’s landscape, and crucially, a fixture of its politics.

Communist parties, principally the CPN-UML, have dominated Nepali politics for most of the past three decades. Their leaders discovered early that squatters, disproportionately poor, landless and politically malleable, made reliable constituents. Promises of land titles and legal recognition were dispensed before elections. Nothing was delivered afterward. KP Sharma Oli, the CPN-UML’s four-time prime minister, was among the loudest critics when Balen, as Kathmandu’s mayor in 2022, first tried to clear the Thapathali settlement. Balen’s response was withering. The squatters, he said, had been “just a vote bank” for Oli and his party, used when convenient and abandoned otherwise.

The charge stung because it was true. Repeated efforts to relocate the settlements ended in failure, not least because federal governments, dominated by the left, declined to provide the municipal authorities the security forces needed to do the job. Balen’s own first attempt as mayor, in November 2022, ended in a violent clash that left 36 people injured, including the municipal police chief.

What changed is that Balen now controls the federal government. His Rastriya Swatantra Party (RSP), a four-year-old anti-establishment outfit, won a landslide in the snap general election of March 5th, triggered by the September 2025 Gen Z uprising that toppled Oli’s government and left 77 people dead. The RSP won 124 of the 164 counted seats. It swept all ten Kathmandu Valley constituencies. Balen himself defeated Oli in the latter’s home constituency of Jhapa-5 by nearly 50,000 votes, the largest winning margin in Nepal’s parliamentary history.

Mishra was generous in acknowledging a point that Balen’s admirers sometimes gloss over. The RSP’s triumph was not Balen’s alone. Without Rabi Lamichhane, the party’s founder and formal chairman, mired in legal controversies but the architect of the RSP’s organisational infrastructure, none of what is now visible would have been possible. Balen and Lamichhane together delivered, in Mishra’s words, “an extraordinary electoral result rarely seen in the world.” They brought not a political but a generational transfer of power to Nepal, one that, Mishra judges, “will not easily be reversed.”

The eviction drive is part of Balen’s 100-point governing roadmap. The plan promises a GIS-based national database of landless squatters, verification of genuine beneficiaries within 60 days, and resolution through relocation and land allocation within 1,000 days.

Not everyone is applauding this move though. Amnesty International called the evictions a “dangerous erosion of the rule of law,” warning that clearing families without prior verification or guaranteed alternative housing risked turning a governance challenge into a human rights crisis. Few lawyers and Gen Z activists filed a petition at the Supreme Court challenging the evictions as unlawful, arguing that affected families were not consulted and have nowhere to go.

The government has arrested Narayan Pariyar, the acting chair of the Squatter Front and a CPN-UML leader, on what police described as banking charges unrelated to the eviction. Critics find the timing convenient. And residents themselves tell a more complicated story. Manisha Lakandri, whose family has lived in Thapathali for over fifty years, said she had been asked to find her own housing. “We are searching for rooms, but we haven’t found any,” she said.

The government’s response is that eviction and rehabilitation can proceed in sequence.Verification of genuine squatters will follow promptly and land will be distributed. Senior advocate Raju Chapagain is unpersuaded. Eviction first, verification later, he argues, is simply not a lawful approach.

Whatever the legal merits, the political logic is clear. For three decades, Nepal’s communist parties built power partly by managing, rather than solving, the squatter problem. They positioned themselves as protectors of the poor against an indifferent state, while ensuring that the poor remained dependent enough to keep voting. Balen has scrambled this calculus entirely. By acting where the left only promised, he has stripped the communists of one of their most durable grievances. The electoral data from March tells the same story. The RSP did best in urban and semi-urban areas with high internet access, among voters who had grown up watching the left govern Nepal into stagnation. The CPN-UML was reduced to 25 seats. The Nepali Congress, once the country’s dominant liberal party, won just 38.

Nepal’s communists now face what one analyst called “a huge ideological crisis.” They lack a platform to rally citizens around. Their failures in government contributed directly to the emergence of a rapper-engineer who made cleaning up Kathmandu – literally and figuratively – his political identity. The Gen Z uprising that opened the door for Balen was itself a repudiation of a political class that the left had long led.

Balen’s approach carries its own risks. Moving fast without adequate resettlement guarantees could generate genuine suffering and political backlash. His own party shows signs of internal strain. Second-tier RSP leaders say they were not consulted before the eviction decision. And his record as mayor, which included accusations of using police against street vendors and demolishing structures without full due process, suggests a governing style that prizes speed over procedure. But in a country that has watched fourteen commissions do nothing, speed may be exactly what voters wanted.

  

By Saturday morning, if Balendra Shah’s orders hold, a convoy of excavators will rumble down the embankment road at Thapathali, past the temple ghats and the sluggish brown coils of the Bagmati River, toward a settlement that has resisted the state for decade. What will make the scene unusual is not the machines. Kathmandu has seen this before, with predictably bloody results. What will be different is the figure behind them. Shah, the rapper-turned-mayor-turned-prime minister, has ordered the clearance himself. For once, Nepal’s chief executive and the man who wants to clean the riverbanks are the same person.

To understand why this moment matters, one must return to November 2022, the first and most instructive act in Balen Shah’s long drama with the Bagmati. Freshly elected as Kathmandu’s first independent mayor, high on a mandate built from social media clips, rap lyrics and a furious public exhausted by the old parties, Shah sent his city police to Thapathali with two excavators. He had issued due notice. The High Powered Committee for Integrated Development of Bagmati Civilisation had issued notice three times. The squatters had been told to move.

They did not move. Instead, they threw bricks. The chief of the city police was beaten. More than 21 people were injured. The excavators retreated. Then, in what became the defining pattern of Balen’s mayoralty, something worse happened: the federal government, led by the parties his voters had rejected, did nothing. Prime Minister K.P. Sharma Oli’s administration declined to send the Nepal Police and Armed Police Force in force to back the municipality. The squatters cheered. Shah fumed on social media. The settlements remained.

It was not the first time the state had tried and failed. In May 2012, the Baburam Bhattarai government mobilised more than 2,000 security personnel to pull down 251 huts at the same location. Political pressure halted the drive mid-operation. The government then spent Rs 230 million building a resettlement colony at Ichangu Narayan in the Nagarjuna hills, intending to give displaced families somewhere decent to go. Not a single family moved in. The site lacked public transport, employment access and adequate water, and had not been designed with any community input. That failure became the definitive case study in how Nepal handles its landless poor: with money, noise and no follow-through.

The pattern repeated across the decades. Every commission formed to resolve the landless question, more than a dozen in thirty years, produced reports and nothing else. Every party, when in opposition, made pilgrimages to the riverbank settlements and vowed solidarity. Every party, upon entering Singha Durbar, quietly forgot the vow. By 2022, an estimated 34,096 families were living along the Bagmati’s banks in the Kathmandu Valley alone, a number that had grown rather than shrunk through every successive government’s tenure.

The emotional vocabulary around the Bagmati settlements has always leaned hard on a single word: sukumbasi, the landless squatter, the dispossessed, the voiceless poor. The placard-writers at the November 2022 protests understood its power. “You can’t kill the poor,” read one banner as squatters marched from Maitighar to New Baneshwar. The slogan was effective, partly because it was true. Genuine landlessness exists on the Bagmati banks and makes a serious moral claim on the state’s attention.

But the settlements are not a monolith of misery. They never were. Krishna Maya Magar, a long-time Thapathali resident, told local media plainly that parts of the settlement had long ago become a secondary real estate market. Huts were bought and sold. People with houses elsewhere registered as squatters to claim political protection. Absentee squatter-landlords rented out their riverside plots to newcomers, including, as Magar noted, Indian nationals who had purchased their footholds from departing Nepali occupants. Some of those wielding the poorest-sounding placards own land elsewhere in the Valley. They have simply found that riverbank occupancy, combined with political patronage, is cheaper than paying rent or property tax.

The numbers bear this out. Out of the 29,000 squatter families counted across the Kathmandu Valley in 2012, only 1,082 were formally registered with the Nepal Landless Democratic Union Party, a fraction so small it suggests that a large majority of occupants did not meet even the movement’s own definition of genuine landlessness. The genuinely dispossessed and the strategically positioned have, for three decades, sheltered under the same political umbrella, and Nepal’s parties have been happy to keep it that way. A population that believes its survival depends on political protection is a population that votes reliably, can be mobilised before elections and can be abandoned without consequence afterward.

This is not to say the genuine poor deserve what is coming to them this weekend without a credible plan for what follows. They do not. But the conflation of every riverbank dweller with the genuinely landless has been the foundational political lie that preserved the status quo. Every party found it easier to weaponise the authentic poor as shields for the fake poor than to do the painstaking work of distinguishing between them. The result is over a dozen wasted commissions, Rs 230 million in squandered resettlement spending and a riverbank that in 2026 still looks almost exactly as it did in 2012.

Balen Shah did not create the conditions for his own rise. He surfed a wave that three decades of Nepali governance had been quietly building. By 2025, remittances accounted for nearly a quarter of GDP, a figure that sounds impressive until one grasps what it represents: a state that had effectively exported its own working-age population because it could not generate productive employment at home. Youth unemployment was a structural feature, not a cyclical accident. Corruption was not a deviation from the system but its organising principle. The rotating cast of Oli, Deuba and Prachanda had produced, between them, no functioning economic programme and no credible plan for anything beyond perpetuating their own rotation.

When young Nepalis set fire to Singha Durbar in September 2025, they were not articulating a specific manifesto. They were expressing a verdict. Seventy-seven people died in that uprising. What replaced the old order, first an interim government under the austere former Chief Justice Sushila Karki, then the March 2026 elections, was not a revolution in the classical sense. It was something stranger and more radical: a democratic repudiation so complete that the Nepali Congress and CPN-UML, the parties that had defined the country’s politics since 1990, were reduced to rump status. Balen’s Rastriya Swatantra Party won 182 of 275 seats in the House of Representatives, nearly 48 percent of the proportional vote nationally, sweeping six of seven provinces. For the first time since 1999, Nepal had a majority government without coalition arithmetic.

Balen had been among the first prominent figures to back the protesters publicly, and, in a decision that in retrospect looks like genuine political maturity, he declined to seek power during the interim period, supporting the Karki arrangement instead. When he joined the RSP in December 2025 and resigned the mayoralty, the alignment of ambition and moment was complete. The man who had tried and failed to clear the Bagmati banks as a mere mayor, denied federal support by the very government his voters had rejected, was now in a position to give himself that support.

Critics of the current clearance, and they exist across the political spectrum, including Gen Z leader Raksha Bam, who called it a betrayal of the people and political dishonesty, focus on process. Where will people go? Has alternative housing been arranged? Is this not simply the same brutal eviction that has failed every time before? These are legitimate questions. The history of the Ichangu Narayan debacle demands they be asked loudly.

But the critics elide an equally important question: what does it cost to not clear the riverbanks? The Bagmati, the sacred river that cremation ghats and ancient temples line, the waterway that defines the spiritual geography of the Kathmandu Valley, flows today as an open sewer. Sewage from tens of thousands of riverbank families drains directly into it. Industrial effluents join it further downstream. The river is, by almost any environmental metric, a catastrophe. The settlements that line it are not merely an eyesore. They are actively preventing the ecological rehabilitation of the waterway that the valley’s 3.5 million residents depend upon. Floods in the monsoon inundate the same riverbank huts year after year, killing the people that progressives claim to protect, because no government has had the political courage to relocate them to safer ground.

There is a harder case to be made, and Balen’s supporters are not wrong to make it. The actual poor of the Bagmati banks are not well-served by the status quo. Their homes are structurally unsound, perennially flood-prone and built without sanitation. Their children attend school without the security of knowing whether the family will be homeless by evening. Their tenure is legally precarious regardless of how many politicians stop to wave at them before elections. A genuine resettlement programme, properly funded, properly designed with community input, properly located with access to transport and employment, would make the lives of the genuinely landless measurably better than what the riverbank currently offers. The tragedy of Nepal’s history on this question is not that governments tried to relocate the poor and got it wrong. It is that they used the poor as political currency and got nothing done at all.

The risk that hangs over Balen Shah’s action this weekend is not that it is unjustified. It is that it proves half-finished, as every previous attempt has been. A clearance without a credible resettlement plan replicates the pattern of 2012: displacement without resolution, scattered families, a settlement rebuilt within years, political capital squandered and the underlying problem exactly as intractable as before. Government spokesperson Sasmit Pokharel has been notably ambiguous about whether the cabinet has formally approved a resettlement framework. Security agencies, meanwhile, say the plan is in its “final stage.” The gap between those two statements is where Nepal’s squatter politics have always gone to die.

Balen Shah’s singular advantage, the one he lacked as mayor, is that the federal government is no longer his adversary. When his city police were stoned in November 2022, the Nepal Police stood back and watched. This time, the Inspector-Generals of both the Nepal Police and the Armed Police Force have received their instructions from the prime minister’s office directly. The jurisdictional ambiguity that has paralysed every previous attempt, the question of who controls land that is technically federal territory while the city deploys the personnel, has been dissolved, at least for now, by the fact of a majority government with a single chain of command.

Whether that political alignment is enough to produce the genuinely better outcome the genuine poor deserve, real housing and not just clearance, a resettlement site with water and buses and jobs rather than another empty colony in the hills, remains the only question that matters. The bulldozer, as a rapping young engineer once understood intuitively, is a statement. 

When Sita Badi walked into Nepal’s Ministry of Women, Children and Senior Citizens for the first time as its minister, she wept. The cameras caught it. The image spread. Across the political spectrum, from the left to the right, from veteran parliamentarians to first-time voters, the reaction was the same: praise, and something warmer than praise. Politicians who agree on almost nothing agreed on this. Her appointment, they said, was the beauty of democracy made visible.

Ms Badi, 30, is the first person from the Badi community ever to hold federal ministerial office in Nepal. The Badi, a Dalit sub-group concentrated in Karnali province, occupy one of the lowest rungs of a society long defined by the cruelties of caste. They are among the poorest, the least educated and the most stigmatised of Nepal’s many marginalised communities. The assumption, persistent and corrosive, has long been that Badi women are available for sexual exploitation. 

The earliest chapter of Ms Badi’s life is one that most politicians would not relate. She grew up in Jhuprakhola, ward 11 of Birendranagar Municipality in Surkhet district, in a community of roughly 158 Badi settlements where the primary livelihood was, and in many places remains, the harvesting of sand and stone from the Bheri River. Her parents worked the riverbed. The family was poor, and educating a daughter pressed hard against their means.

“Life itself is struggle,” she told Nepal Television’s current affairs programme Jigyasa on April 24th. “My struggle is no different from anyone else’s. But perhaps mine started earlier.”

At the age of 13, she was brought to Kathmandu by Jyoti Ghar Nepal, an NGO that saw potential in a girl. There she completed her schooling, then a bachelor’s degree in social work, then a master’s degree in political science. For years she volunteered at the organisation that had given her a start, learning what she would later describe as the art of converting solidarity into systems.

Independence, however, was always the destination. “I realised I could not remain dependent on others forever,” she said. She founded Badi Sustain Multipurpose Private Limited, a company that provided skills training in stitching and handicrafts to Dalit and Badi women. She simultaneously ran Sundar Saha Sanstha, a parallel body that supported roughly 30 to 35 children from disadvantaged backgrounds with education and basic needs. When floods or landslides struck remote communities, she mobilised blankets and rations. 

Her path into politics came through the Rastriya Swatantra Party (RSP), the reformist movement that swept Nepal’s March 2026 general election under Balendra Shah, the structural engineer and musician who became the country’s youngest prime minister. Ms Badi was elected to the House of Representatives through the proportional representation system, representing the Dalit women’s cluster.

“I had never imagined becoming a member of parliament,” she said. “The thought of becoming a minister had never crossed my mind at all.” When the RSP told her that her community needed a leader from within it, she agreed. The party kept its word. Prime Minister Shah appointed her to the cabinet on March 27th.

Nepal’s Ministry of Women, Children and Senior Citizens is, as Ms Badi freely acknowledges, one of the most demanding portfolios in government and one of the most neglected. Women constitute 51 per cent of Nepal’s population. Children account for 33.8 per cent. Senior citizens represent a further 10 per cent. The ministry is responsible for the welfare of the vast majority of the people. Its budget, relative to this mandate, is almost comedically inadequate.

“This ministry covers nearly everyone,” Ms Badi said, “and yet it receives one of the smallest allocations. Very little appears to have been done, not because no one tried, but because the resources were never there.” She has begun receiving briefings, reviewing laws and calling for monitoring of existing programmes. “It is not enough to say work is being done and move on. We need to be present. We need to check. Without oversight, children in institutions suffer every day in silence.”

On children specifically, she is alarmed. She describes an explosion of child welfare organisations, springing up, in her phrase, like mushrooms, many of which use children’s names to attract funding while delivering little to the children themselves. She wants stricter monitoring and direct conversations with the children in the homes, not just their administrators.

On senior citizens, she describes a pattern she has witnessed firsthand: elderly parents, their children abroad or simply indifferent, left at care homes that lack legal accountability. She visited several such facilities before taking office. “Some parents told me they had been brought there and left. They did not choose it. They want somewhere decent to live, with people who spend time with them.” Her proposed response is legislative: stricter laws, enforced rather than merely enacted.

On gender-based violence and entrenched practices such as the dowry system and chhaupadi, the practice of banishing menstruating women to outdoor huts, still found in parts of Sudurpashchim, she is blunt. “Mediation is not a substitute for consequences,” she said. “When a penalty is written down and not applied immediately, no change comes. Ever.”

Her most striking policy instinct concerns the direction of awareness campaigns. Conventional wisdom in gender advocacy targets women; teach them their rights, empower them to speak. Ms Badi inverts this. “We have focused on raising awareness among women,” she said. “But I believe we must begin with men. When men understand, genuinely understand, then they can support women. Until then, we are asking women to push against a wall that has not moved.”

It is a pragmatic rather than ideological position, born of years working in communities where male gatekeeping determined whether any programme reached women at all. It is also, characteristically, a position rooted in sequencing.

When asked on Jigyasa what she would say to members of her community watching, she said, “first, have somewhere to live. Then food. Then we can talk about education. We must go step by step. But we must go.”

Her asset declaration, released alongside the rest of Prime Minister Shah’s cabinet in April, was the simplest on the list containing wedding gifts of gold, modest savings in two banks, 20 chickens and a dog. No debts. No property. A minister with almost nothing who has spent her life giving what little she had to others.

Nepal has a long tradition of appointing this ministry to politicians who treat it as a waiting room for something better. Ms Badi has no interest in waiting rooms. She grew up in a community that the state had never bothered to enter. She knows what it feels like to be on the other side of an unvisited door. That knowledge, more than any policy paper or budget line, is what she carries into the job. Other ministers study the vulnerable. She was one of them.

There is a seductive moral logic to the welfare state. Those who advocate for it are deemed compassionate, progressive, humane. Those who question it are branded heartless, enemies of the poor dressed in the language of economics. In Nepal, this framing has been deployed with particular effectiveness by the communist and socialist parties that have dominated government for much of the past decade.

The new finance minister, Swarnim Wagle, is an economist who understands the difference between appearing to help people and actually helping them. The question is whether he will have the political nerve to act on that distinction, or whether he too will succumb to the freebie temptation, wrapping fiscal recklessness in the language of solidarity.

Begin with the moral case, because the welfare state’s advocates always do. Expanding government benefits, they say, is an expression of collective goodness, evidence that Nepali society cares for its most vulnerable. But this claim dissolves the moment one examines how the welfare state actually works.

In a free society, a person who chooses to donate part of their income to a struggling neighbour, a temple, or a charitable cause is performing a genuinely moral act. The virtue lies in the choice. They could have spent that money on themselves. They didn’t. That voluntary sacrifice is the substance of real compassion.

Now consider what happens when the state steps in. A taxpayer does not choose to fund the government’s social programmes. He is compelled to. The tax collector does not ask; he demands. The citizen who objects cannot opt out. His money is taken regardless of his wishes, his values, or his own assessment of how it might better be used. The structure is identical to a thief who holds a gun to a wealthy man’s head, takes his money, and distributes it to the poor, then expects to be called compassionate. The destination of the money does not change the nature of the transaction.

Who, then, is being virtuous in this arrangement? Not the bureaucrat who processes the transfer. Not the politician who votes for the programme. Not the voter who elects him. Genuine goodness requires the freedom to say no. Strip that freedom away and what remains is not compassion. It is coercion dressed in welfare clothing. The communists who designed Nepal’s expanding entitlement system have confused the two, and the confusion is proving expensive.

The welfare state is not merely a moral confusion. It is, as a model of social organisation, a repeatedly documented failure. And Nepal’s political left has chosen to import it at precisely the wrong moment in the country’s development.

As governments have expanded their role as provider and guarantor, the size of those governments has grown and the inequities they were supposed to redress have stubbornly persisted or worsened. More public money spent on education has, in country after country, produced worse schools. More public money spent on housing assistance has produced more dependency. More money spent on support for vulnerable families has restructured incentives in ways that make those families more fragile rather than less. The programmes multiply; the problems they were designed to solve do not shrink.

Nepal’s communists have followed this script with depressing fidelity. Old-age allowances, single-women stipends, disability grants, ethnic minority transfers, each introduced with genuine humanitarian intent, each gradually expanding in coverage and cost, and each increasingly disconnected from any rigorous assessment of whether they are reaching those who need them. Now come proposals to make these benefits universal, to strip away means-testing entirely and spread them across the population regardless of need or circumstance.

This is not a progression toward fairness. It is the mathematical guarantee of ineffectiveness. A country with Nepal’s fiscal constraints, a tax-to-GDP ratio barely above 20%, chronic budget deficits, and deep dependence on foreign aid and remittances, cannot afford to give modest benefits to everyone. What it can do, if it is disciplined, is give meaningful support to those who genuinely cannot help themselves. Universality sacrifices that possibility on the altar of political optics.

Europe’s welfare states were not constructed by poor countries that decided redistribution should come before growth. They were assembled, slowly and at enormous cost, by societies that had already achieved high levels of productivity, institutional capacity, and tax compliance. Denmark, Sweden, and Germany built their social architectures on a foundation of industrialisation, strong property rights, functioning courts, and decades of capital accumulation. They became wealthy first. Then they redistributed.

Nepal’s GDP per capita is roughly $1,300. Its civil service cannot reliably deliver the services the government already promises. Its infrastructure is chronically underfunded. To graft a Nordic entitlement structure onto this base is not ambition. It is a category error, like fitting an expensive roof onto a house with no foundations.

There is a further demographic irony. Nepal’s demographic window, the period when its working-age population is proportionally at its largest, is open right now. This is exactly the wrong moment to begin diverting productive capacity into universal transfers. Every year spent expanding welfare rather than investing in education, infrastructure, and productive capacity is a year of squandered demographic dividend.

The people who will bear the heaviest cost of today’s populism have not yet voted. Some of them have not yet been born. This is the oldest and most reliable feature of fiscal irresponsibility: the costs fall on those with no voice in the decision. Universal benefits, once granted, are nearly impossible to withdraw politically. Every household receives them; every household votes. What begins as a modest stipend becomes, over time, a structural claim on the budget that crowds out the capital investment a developing economy desperately needs. Roads that would connect hill farmers to markets. Power lines that would allow small manufacturers to run machines. Schools that would give the next generation a reason to stay in Nepal rather than migrate to Qatar or Malaysia. The left calls this solidarity. A more honest word is mortgaging.

Mr Wagle did not enter public life to manage the slow fiscal deterioration of his country. He has the training to understand what is happening and the standing to say so clearly. He should demand rigorous means-testing for every existing benefit programme and publish transparent data on what each one costs per beneficiary actually lifted above a meaningful poverty threshold. He should resist, firmly and publicly, any move toward universalising transfers that the country’s budget cannot sustain. He should make the case, to the cabinet, to the parliament, to the public, that a government which tries to give something to everyone ends up giving nothing meaningful to anyone.

Above all, he should refuse the bargain that awaits every finance minister in a fragile coalition. Nepal has already made that bargain too many times. A welfare state is not evidence of a society’s compassion. It is, at best, a record of its intentions. What matters is whether those intentions translate into lives that are actually better, or whether they translate, as they so often do, into bureaucracies that grow, deficits that widen, and a next generation that inherits a poorer country than it deserved.

Mr Wagle has the knowledge to know the difference. Nepal is waiting to see if he has the nerve to act on it.

Nepal’s Home Minister Sudan Gurung has tendered his resignation, citing conflict of interest concerns stemming from his shareholding in companies linked to Deepak Bhatta, the controversial businessman arrested on April 1 in connection with a Rs 3.7 billion money laundering investigation. In his resignation statement, Gurung wrote that ethics matter more than the position, and that no power is greater than public trust. He said he was stepping aside so that any investigation into his affairs could proceed without the shadow of influence that comes with holding the country’s most powerful law enforcement portfolio.

The gesture was, on the surface, noble. But it has left Prime Minister Balendra Shah in a political minefield.

The controversy erupted over the weekend when media outlets reported that Gurung held shares in Star Micro Insurance Company Limited and Liberty Micro Life Insurance, two firms also linked to Bhatta and the Shanker Group. Gurung’s name appears in the insurance company’s preliminary share register at number 49, representing an investment of approximately Rs 2.5 million. Neither company had yet gone public through an IPO.

The shares, reportedly purchased after the Gen Z movement, were not listed in Gurung’s public asset declaration submitted on April 12. Gurung maintained this was a matter of classification — that his broader stock market investments of over Rs 20 million had been declared — but critics found the distinction unconvincing. “I would not hide Rs 2.5 million worth of shares when my total declared assets exceed Rs 20 million,” he said in his public clarification. “This is simply a matter of classification.”

It was a very Nepali scandal. A minister who had spent months casting himself as the embodiment of clean governance was now explaining, with considerable urgency, why shares he held in a money laundering suspect’s associated companies were not, technically speaking, hidden. The interpretation of asset declaration rules may well be complex. But in politics, the appearance of wrongdoing often travels faster than the facts.

Bhatta, who chairs Infinity Holdings, had long faced scrutiny for allegedly leveraging political and bureaucratic connections to secure lucrative government contracts, operating with perceived impunity under multiple administrations. His arrest followed years of failed attempts to hold him accountable. Previous investigations were reportedly halted due to political pressure, but the case was revived after the new government led by Balendra Shah was formed. 

Making matters worse for Gurung was an old photograph that surfaced showing Bhatta being honoured as a donor at a 2021 event hosted by Hami Nepal, the NGO founded and chaired by Gurung himself. Critics raised concerns about the lack of detailed disclosures on Gurung’s part regarding investments tied to the very figures that his Home Ministry was in charge of investigating. For years, Gurung had been one of the loudest voices demanding transparency from Nepal’s political class. 

Gen Z Movement Nepal called on the government to immediately dismiss Gurung, arguing that allowing him to remain in office could influence the investigation process and represents a clear conflict of interest. CPN-UML demanded his resignation and called for a high-level investigation mechanism to be formed immediately. Nepali Congress issued similar demands. Even within the RSP, the mood was deeply uncomfortable. An RSP lawmaker and party office-bearer said that allegations against the home minister were more serious than those that brought down Labour Minister Deepak Kumar Sah just two weeks earlier. 

Prime Minister Shah held a separate meeting with RSP leaders late Monday evening as calls for Gurung’s resignation intensified. He also sought a written clarification from his Home Minister, which Gurung’s secretariat duly submitted. The procedural formality did little to quiet the noise.

Gurung spent Tuesday fighting back. On Facebook, he was unsparing: “Those who have had their eyes fixed on state money for years are scared now. The media trial and the orchestrated noise is nothing but their desperation. The action won’t stop, I won’t be rattled. I haven’t seen them work this hard even when someone was embezzling Rs 500 million a day.” Less than 24 hours later, he was gone.

It is worth pausing to remember how electric Gurung’s tenure felt just weeks ago. When he took office on March 26, he immediately captured the public imagination. He directed the arrest of former Prime Minister KP Sharma Oli and former Home Minister Ramesh Lekhak, names that had long seemed untouchable. He published arrest lists on Facebook like dispatches from a campaign. He named the Shanker Group’s Sulav Agrawal among those brought in as part of the broader Bhatta probe. For a country exhausted by the spectacle of powerful men walking free, it felt, briefly, like something had genuinely changed.

His tenure was nevertheless marked by controversy from the start. Party lawmakers complained that he failed to coordinate with elected representatives during inspections and interfered in matters handled by other ministries. Senior police officials had pushed back when he directed the arrest of Oli and Lekhak, insisting that legal procedures be followed first. The two were eventually released on a Supreme Court order after 15 days. Critics from the security establishment said Gurung had turned policing into a social media performance, treating operational decisions as content rather than process.

None of that diminished his popularity with the public. He had built his following not as a politician but as an activist, a disaster responder, a face of the movement that toppled a government. People wanted to believe in him. That is precisely what made the share controversy so corrosive.

Gurung’s resignation statement struck a starkly different register from his combative Facebook posts. It was reflective, principled and, in its way, unexpectedly moving. He invoked the sacrifice of 46 young people killed during the Gen Z uprising and said the government born of that sacrifice must be held to a higher standard. “My tenure has been one of honest work,” he wrote. “For me, ethics matter more than the position, and no power is greater than public trust.”

He was direct about his reasoning. He said he was stepping down so that an impartial investigation could take place without conflict of interest, and so that his continued presence in office could not be used to question the integrity of that process. “I have fulfilled my moral responsibility,” he wrote. “Now my appeal is this: if we truly want change, everyone must stand on the side of truth, honesty and self-accountability.”

He added, with some pointed edge, that some journalists who had covered him also held undeclared shares in various companies, and that those demanding a clean republic from others must be willing to demand the same of themselves. “Those who want Ram Rajya,” he wrote, “must also be capable of sacrifice and moral courage.”

It was a dignified exit, and a strategically intelligent one. By resigning on his own terms, invoking the movement’s martyrs and the language of conscience, Gurung denied his critics the satisfaction of a sacking. He left the door open to a return.

This is now the second minister to exit the Shah cabinet under a cloud in less than a month. Labour Minister Deepak Kumar Sah was removed after the RSP’s central disciplinary commission found he had misused his position to keep his wife on the Health Insurance Board. That looked like a government willing to police itself. Two departures in rapid succession looks like something else entirely.

The Bhatta investigation, which the RSP government had been actively championing as proof of its anti-corruption credentials, has now entangled its own Home Minister. Sources indicate the probe gathered pace following the formation of the new government, with instructions to expedite the case. The irony is sharp enough to cut. The minister tasked with overseeing law enforcement held shares in companies at the centre of the very law enforcement operation he was directing.

Investigators have said that anyone connected to Bhatta’s network remains under scrutiny, and the web of companies, politicians and businessmen continues to widen. The Shanker Group alone has borrowings estimated at close to Rs 200 billion from banks and financial institutions. With Gurung gone, the Home Ministry is now a vacancy at a sensitive and dangerous moment in that investigation.

For Prime Minister Shah, there is a deeper problem that no reshuffle can easily fix. The RSP came to power riding a wave of public hope cultivated through the blood and protest of the Gen Z movement, that a new generation could actually be different. The party won a landslide on March 5 on promises of transparency and good governance. Each cabinet controversy erodes that promise. Each resignation, however honourably framed, raises the uncomfortable question of how thoroughly the party vetted its own people before placing them in positions of enormous power.

The small mercy for Shah is that Gurung went of his own volition, and went with grace. He can say, as Gurung himself said, that the system is working, that questions were asked, pressure was applied, and a minister stepped back rather than dig in. The rather greater difficulty is that a government only weeks old has already lost two ministers, is managing one of the most consequential corruption investigations in recent Nepali history, and must now find a credible replacement to run the ministry at the heart of it all.

In his resignation statement, Gurung reminded the country of why so many had believed in him in the first place. He spoke of the youths who died, of the obligation their sacrifice creates, of the standard a public life must meet not by compulsion but by conscience. It recalled the way Nepal’s Gen Z movement itself had spoken, with a moral seriousness that felt new in this country’s politics.

Whether history judges him as the man who blinked under pressure, or the man who showed Nepal’s political class what accountability actually looks like, may depend entirely on what the investigation finds next. If he is cleared, his exit will read as an act of rare integrity. If investigators find more, the resignation will be remembered as the moment the floor gave way.

What is certain is that the story of Sudan Gurung, the DJ-turned-disaster-responder-turned-Gen Z icon-turned-Home Minister, is far from over. He remains a parliamentarian. He retains a platform. He has shown he can command both a crowd and a news cycle. In Nepal’s turbulent new political chapter, this is not the end of a career. It reads far more like the end of the first act.

The night before he was sworn in as Nepal’s prime minister, Balen Shah released a rap song. The track, “Jai Mahakali,” called for unity across the ethnic and regional lines that have for decades made Nepal so difficult to govern. His supporters shared it hundreds of thousands of times before dawn. The following morning, in black trousers, a matching jacket and his signature cloth cap, he took the oath of office and became the 47th prime minister of Nepal, its youngest ever and the first from the Madhesi community of the southern plains. That combination, the song and the ceremony, the artist and the engineer, the outsider and the head of state, tells you most of what you need to know about why this government feels different from everything that came before it, and why so many people with so many competing agendas are arguing about what it means.

His critics have settled, with some relish, on the comparison to Volodymyr Zelensky. The Ukrainian president was an actor and comedian before a Russian invasion thrust him onto the world stage, and the argument runs that Mr Shah, similarly unburdened by diplomatic training or foreign policy experience, risks steering a landlocked nation between two of the world’s most powerful and assertive states into exactly the kind of miscalculation that a more seasoned hand would avoid. Nepal sits between India and China, each of which has strong and sometimes contradictory ideas about what a well-governed Nepal should look like and neither of which is above expressing those ideas through infrastructure budgets, trade routes or quiet political pressure. The fear is that a prime minister who campaigns with the emotional directness of a rapper and governs with the impatience of an engineer might, in a moment of nationalist sentiment or diplomatic overreach, say or do something irreversible.

His admirers, for their part, have settled on a different comparison, one that flatters more generously and instructs more usefully. Lee Kuan Yew, Singapore’s founding father, transformed a tiny resource-poor island with an anxious geography into one of the wealthiest and best-governed nations on earth through sheer administrative will, the ruthless deployment of talent, and an absolute refusal to tolerate the gap between what a government promises and what it delivers. The fans who invoke his name when they look at Mr Shah are pointing at something real. The 100-point reform agenda approved in the first cabinet meeting, with its tight deadlines, named responsible officials and public monitoring dashboard, is precisely the kind of governance-by-accountability that Mr Lee pioneered. The cabinet of technocrats and young professionals, filled on merit rather than by party affiliation, is a Singaporean instinct applied to a Himalayan state. The willingness to move fast, make enemies and trust that the mandate will hold long enough to do lasting damage to the old order is, unmistakably, the Lee Kuan Yew method.

The difference, and it is a crucial one that Mr Shah’s admirers should hold onto, is that Mr Lee built his miracle without democratic accountability and Mr Shah must build his with it. Singapore’s founding father managed elections to prevent any serious opposition from emerging, used defamation suits against critics and tamed the press into compliant silence. Mr Shah arrived in office having beaten a four-time prime minister in his own stronghold by nearly 50,000 votes, the largest winning margin in Nepal’s parliamentary history. His authority rests not on suppression but on an extraordinary act of public trust. That is both more demanding and more durable than anything Singapore’s model required. If Mr Shah delivers, Nepal will have proved something that Lee Kuan Yew never tried to prove, that a state can be both accountable and efficient, that democracy and competence are not, as the Singapore story seems to suggest, in tension with each other.

Nowhere is this argument more pointed than in the question of political party-affiliated unions. Mr Shah’s decision to dismantle party-linked bodies in government institutions, and to replace student political organisations on university campuses with non-partisan student councils, has been called his most controversial reform but, in the view of this media, his most necessary one. Nepal’s trade unions and student bodies have not, for the most part, functioned as the engines of worker protection and civic education that their defenders now claim. They have functioned as patronage machines, through which the major parties colonised the civil service, staffed ministries with loyalists, and ensured that every institution of the state was, at some level, an instrument of political survival rather than public service. A nurse who wanted a hospital posting, a teacher who wanted a school placement, an engineer who wanted a government contract learned quickly that the right union card mattered more than the right qualifications. It made it dishonest in ways so deep and so normalised that most Nepalis had stopped expecting anything different.

Dismantling that system is not an attack on organised labour or on student politics. It is an attack on the capture of both by party machines that used them as tools of control rather than protection. Workers in Nepal’s public sector will retain the right to organise; what they will not retain is the right to do so under banners that serve the interests of party leadership rather than their own. Students will continue to debate, advocate and push back against authority; what they will lose is the system by which Nepali Congress and UML and their various satellites used campus politics as a recruitment pipeline for future political operatives. This is an entirely defensible reform in a country where the blurring of party interest and institutional function has been the root cause of almost every failure of governance in the past three decades.

The cabinet that will attempt to implement all of this is itself a statement of intent. Ten of fifteen ministers are under 40. Sasmita Pokharel, who turns 30 this year, runs the education ministry. Sudan Gurung, 38, who rose to national attention during the Gen Z protests of 2025, is home minister. Swarnim Wagle, the finance minister and the oldest at 51, is an economist of genuine distinction who has spent years arguing for exactly the structural reforms the government is now attempting. Nisha Mehta at health, Sobita Gautam at law, Pratibha Rawal at general administration represent a generation of professionals who built their credentials outside the party system and who have now been asked to reform the state that the party system built.

The Lamichhane question also hangs in the air, as it must. Rabi Lamichhane, the RSP chairman who remains Mr Shah’s formal party superior, faces serious allegations of fraud and money laundering. Their alliance was, in the phrase of one Tribhuvan University political scientist, a marriage of convenience. Marriages of convenience tend to become inconvenient at the worst possible moments, and Mr Shah will need to manage that relationship without allowing it to stain a government that has staked everything on probity. It is the one vulnerability in an otherwise unusually strong position, and his critics are right to watch it carefully.

But critics watching that vulnerability would do well to keep the wider picture in frame. Nepal has had 32 governments since 1990 and not one of them completed a full term. It has cycled through prime ministers with a regularity that made serious policy impossible and made the word reform, in Nepali political discourse, almost meaningless from overuse. What Mr Shah has done in three weeks is not merely announce reforms. He has arrested a former prime minister, sacked a minister for nepotism within days of appointment, published a public scorecard against which his own government will be judged, and filled every significant portfolio with someone who appears to have been chosen because they know their subject rather than because they know the right people. He released a rap song the night before his inauguration that asked, simply, to see Nepal smiling. He is now the one responsible for making that happen. The 30 million people who voted for him, marched for him, sang his songs and held their breath through the counting of ballots, are not going to let him forget it.